Ross v. Sequoia Equities: $3.1M Tenant Class Action Settlement

Hogue + Belong obtained a preliminarily approved $3.1 million tenant security deposit class action settlement in Ross v. Sequoia Equities, Inc. The proposed settlement covers roughly 17,000 former California tenants of Sequoia Equities and its affiliated entities, which own and manage approximately 67 apartment communities across the state.

What did the Sequoia Equities security deposit lawsuit allege?

Plaintiffs Kiara Ross, Felicia Costa, and Mark Piepowski filed the lawsuit in September 2023. They alleged that Sequoia Equities routinely withheld security deposits in violation of California Civil Code section 1950.5.

According to the complaint, former tenants were charged for cleaning, painting, carpet replacement, and repairs even when the charges were excessive, unsupported, related to ordinary wear and tear, or for work that was never performed. The plaintiffs also alleged that tenants did not receive the required itemized statements and supporting invoices within 21 days of moving out.

When alleged charges exceeded a tenant’s deposit, Sequoia Equities billed the former tenant for the difference. In some cases, the company referred those alleged debts to collection agencies.

How did the alleged charges affect former tenants?

One plaintiff alleged that a collection agency contacted her nearly three years after she moved out and demanded more than $30,000, even though she had never received a move-out statement.

The complaint also alleged that a transition to new property management software caused hundreds, and possibly thousands, of security deposit statements to be sent to incorrect addresses. As a result, former tenants may not have received an explanation of the charges against their deposits.

How did Hogue + Belong investigate the case?

Hogue + Belong obtained tenant files from a representative sample covering 20% of Sequoia Equities’ properties. The files contained more than 608,000 pages. The firm reviewed move-out charges one by one against the requirements of California Civil Code section 1950.5.

After a full-day mediation before the Honorable Peter D. Lichtman (Ret.), the parties accepted a mediator’s proposal and finalized the class-wide settlement agreement.

What does the proposed $3.1 million settlement provide?

• $1.8 million in cash: Class members will share a non-reversionary settlement payment.
• Approximately $1.3 million in debt forgiveness: Sequoia Equities must stop collection efforts on the covered move-out debts and may not collect, sell, assign, or report those debts through a collection or credit reporting agency.
• Automatic payments for tenants sent to collections: Under the settlement terms, those tenants will receive their payments without filing a claim.

Settlement status: The court has granted preliminary approval. The settlement remains subject to final court approval.

Questions about a withheld California security deposit?

If a landlord withheld your security deposit without proper documentation or sent disputed move-out charges to collections, you may have rights under California law. Read more about California tenants’ rights, or contact Hogue + Belong for a free consultation.

Related results: Read about the firm’s other tenant security deposit cases, including Johnson v. Investment Concepts and Yu v. Gleiberman Properties.